FTSE 250 movers: Serco surges but Stagecoach drops on downgrade

London FTSE 250 index was up 0.6% to 17,235.70 in afternoon trade.

Serco was the standout gainer after the outsourcing company said it expects underlying trading profit for 2016 to be ahead of current market forecasts following a stronger-than-anticipated start to the year.

It now expects revenue of around £2.9bn and underlying trading profit of no less than £65m versus a previous forecast of £2.8bn and £50m, respectively. However, it said the outcome will depend on many factors over the balance of the year.

Zoopla Property Group was also a high riser after strong half-year results, as a powerful performance from new addition uSwitch added to the continued recovery of the core property arm.

With current trading remaining good, management said it expects full year adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) to be at the top end of market expectations.

Payments processor Paysafe was also on the front foot after saying full-year revenue and earnings are now expected to be ahead of market consensus.

In a trading update for the four months to 30 April, the company said it now expects revenue in the range of $950m to $970m versus consensus of $911m. Meanwhile, full-year adjusted earnings before interest, tax, depreciation and amortisation of $270m to $276m, compared to consensus of $260m.

Flexible workspace solutions provider Regus got a boost as RBC Capital Markets upped the stock to ‘outperform’ from ‘sector perform’ and lifted the price target to 400p from 300p.

The Canadian bank said the stock’s recent underperformance was a good buying opportunity.

It argued that Regus has an unrivalled market position, significant expansion potential and strong structural growth drivers.

Pub group Mitchells & Butlers also benefitted from a positive broker note, as HSBC upgraded the stock to ‘buy’ from ‘hold’ and raised the target price to 340p from 300p.

HSBC said while the company’s first half results showed weak trading trends, the new chief executive Phil Urban has a “credible plan for improvement”.

On the downside, Stagecoach slid after JPMorgan Cazenove downgraded it to ‘neutral’ from ‘overweight’, saying the East Coast operation may be at risk of suffering financially.

FTSE 250 - Risers

Serco Group (SRP) 102.00p 11.48%
Zoopla Property Group (WI) (ZPLA) 328.50p 6.97%
Paysafe Group (PAYS) 415.80p 6.67%
Regus (RGU) 319.80p 5.41%
Clarkson (CKN) 2,445.00p 4.40%
Mitchells & Butlers (MAB) 302.30p 4.35%
Paragon Group Of Companies (PAG) 312.00p 4.00%
Virgin Money Holdings (UK) (VM.) 370.00p 3.85%
Ladbrokes (LAD) 137.30p 3.54%
Interserve (IRV) 330.00p 3.42%

FTSE 250 - Fallers

Centamin (DI) (CEY) 101.00p -4.72%
AO World (AO.) 169.10p -3.37%
Acacia Mining (ACA) 310.90p -3.30%
DFS Furniture (DFS) 304.40p -3.24%
Big Yellow Group (BYG) 858.00p -3.21%
Stagecoach Group (SGC) 251.30p -2.14%
Sophos Group (SOPH) 225.90p -1.78%
OneSavings Bank (OSB) 311.00p -1.77%
Polymetal International (POLY) 794.00p -1.67%
Derwent London (DLN) 3,371.00p -1.63%